National Grid should be stripped of its proposed role advising on new power
plant subsidies because of “considerable conflicts of interest”, MPs have
warned.

The FTSE 100 company has been selected by ministers to advise on prices for contracts to subsidise wind farms and other new power plants, and to administer the contracts.

But, as part of a scathing report on the draft Energy Billon Monday, the Energy Select Committee said: “We do not believe that it is appropriate for a private company — which is ultimately motivated by profit making — to act as the [energy reform] delivery body.”

The role would “result in considerable conflicts of interest for National Grid and could result in unnecessary additional costs to consumers”, it warned.

The MPs urged that National Grid be “removed from this role and replaced by establishing a new independent, not for profit company”.

Ministers had already acknowledged a potential conflict of interest, because National Grid owns the electricity transmission cables that would be used to connect up new power plants.

It also has commercial interests in other businesses that might benefit from subsidies, such as carbon capture and storage, and offshore wind transmission.

A National Grid spokesman said it was “very experienced in managing actual or perceived conflicts between different areas of its business and ensuring that sensitive confidential information given to it for one purpose is not used for other purposes”.

Industry figures on Monday backed the committee’s conclusion that the draft Bill in its current form is “unworkable”. The Institute of Directors said unless the Bill was substantially improved, ministers would have to “go back to the drawing board”.